Altair has prepared a written submission to the Communities and Local Government committee on the proposed right to buy extension (RTBE) on behalf of a group of Northern Housing Associations (HAs). Some of the key points included in the report are:
- These Northern HAs support the government in its desire to encourage aspiration for social housing tenants, and of creating new ways into homeownership.
- As part of this commitment to prosperity for their tenants and the communities in which they work, Northern HAs want to ensure that the implementation of the right to buy extension allows them to continue the work of developing and supporting sustainable mixed communities.
- As such there are a number of processes they feel could usefully be embedded into the implementation of the RTBE to ensure its success:
- Prompt discount repayment; with 100% compensation: Timely and complete compensation will support the building of replacement properties; and also provide capital for new development programmes.
- Extension of recycled capital grand fund (RCGF): Greater flexibility in the use of RCGF will support HAs in replacing properties sold.
- Buy back mechanisms for RTBE properties: This will prevent the creation of ‘ransom properties’ which prevent much needed estate regeneration.
- Centrally / regionally administered affordability test and financial advice: This will ensure all prospective homeowners understand the cost of homeownership and can afford the commitment. Central administration will reduce costs to individual HAs and ensure a consistent expert advice is given.
- Use of a cost floor: A cost floor will help protect HAs from making losses on the sale of RTBE properties with lower net book value. This will mean that HAs are not dis-incentivised from investing and improving the condition of their stock.
- Flexible discounts: Would allow social housing tenants the opportunity to buy a more suitable home on the private market. This could stimulate sales and encourage private development within local communities.
- First refusal on resale: This will provide HAs the opportunity to buy back stock in areas they already manage; to guarantee efficiencies of scale and consolidated housing provision.
- Exemption from sales claw-back clauses: Allowing HAs to retain the full RTBE receipt will provide them with the capital required to build replacement homes.
- Consider exemption of rural housing from RTBE: Restrictions on building in rural areas makes the provision of replacement homes very challenging. Exempting rural properties from RTBE will protect the provision of affordable homes in these areas.
A copy of the full report can be downloaded here.